By JAMES KANTER
The European Commission was preparing an appeal on Friday to wealthy countries – and to the United States in particular – to adopt carbon trading as the main system for curbing greenhouse gas emissions.
The Europeans are drafting their proposal (PDF) as the United States enters into a period of intense debate over the wisdom of adopting such market-based systems following the inauguration of Barack Obama as president.
Mr. Obama endorsed a system to cap and trade carbon dioxide, the main greenhouse gas, during his election campaign. The main alternative to a cap-and-trade system is a tax on emissions. Many analysts say such a tax would be a more straightforward way of limiting planet-warming gases from industry.
So far, Europe has created the largest single market for trading permits to emit carbon while Australia and some groups of American states have begun their own initiatives. But the European system also has come under fire for doing too little to stop pollution and for creating vast windfall profits for some industries, like coal-burning utilities.
European officials have acknowledged that the E.U. Emissions Trading System has had a rocky start. But they say it has become more effective following a pilot phase, which ran from 2005 to 2007. E.U. governments approved further measures late last year aimed at reducing the scope for lobbying by governments and industry that diluted the effectiveness of the system during the pilot phase.
The Commission’s proposals, which could change over the weekend ahead of their official presentation on Wednesday by E.U. Environment Commissioner Stavros Dimas, are meant to lay out Europe’s stance as nations prepare for international talks in December in Copenhagen to negotiate a successor agreement to the Kyoto climate treaty.
The first phase of the Kyoto treaty expires in 2012.
Among the Commission’s proposals are “strategic bilateral partnerships” with the United States “to create a transatlantic carbon market,” according to the proposals, seen on Friday by The New York Times.
The proposals also envision member countries of the Organization for Economic Cooperation and Development, a Paris-based think tank for rich-world nations, forming a single carbon market by 2015.
Shipping and aviation — industries that were not part of the earlier Kyoto climate treaty — should be included in any successor treaty agreed at Copenhagen, according to the Europeans.
The proposals also seek ways of promoting agreement by developing nations to participate in binding measures by helping them fund ways of adapting to climate change and cutting emissions.
One suggestion is that rich nations would raise billions of euros each year for aid to the developing world through a levy on air and ship transportation or by using part of the proceeds from sales by governments of pollution permits, among other possibilities.
In the past, efforts at reaching global coordinated action on climate change has been undermined in large part because the United States insisted on binding emissions limits for countries like India and China. Those countries resisted mandatory rules, saying they have right to industrialize and improve their citizens’ standards of living.
Policymakers now are devising ways of helping to fund efforts by developing world as a way of persuading them to accept binding targets.
Some of the businesses that regard climate regulation favorably because it could promote new investment opportunities welcomed the initiative.
Adam Nathan, a spokesman for the Carbon Markets and Investors Association, a trade association, praised “the central role for the carbon market set out by the Commission. But he warned that support from the United States and other nations would be critical to the success of the European strategy.
“Cooperation with the Obama administration must focus on leveraging comparable action from the United States and supporting developing countries in their efforts,” said Mr. Nathan.
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